Cruising – Out of Control: The Cruise Industry, The Environment, Workers, and the Maritimes

By Ross A. Klein

ISBN: 0-88627-313-7 March 2003

CAW 567 Cruising – Out of Control: The Cruise Industry, The Environment, Workers, and the Maritimes

By Ross A. Klein

ISBN: 0-88627-313-7

March 2003

About the Author: Ross A. Klein is Associate Professor of Social Work, Memorial University of Newfoundland. He has taken more than 30 cruises (accounting for 300 days) and has written two books and a number of articles about the cruise industry. He is online at: www.cruisejunkie.com and www.ucs.mun.ca/~rklein/cruise.html

Acknowledgements: The author would like to thank Kerri-Anne Finn, Larry Haiven, John Jacobs, Alasdair Sinclair and Anne Webb for their comments, assistance and support.

CANADIAN CENTRE FOR POLICY ALTERNATIVES – P.O. Box 8355, 6175 Almon Street, Halifax NS B3K 5M1 tel: 902-477-1252 fax: 902-484-6344 email: [email protected] http://www.policyalternatives.ca Contents

Executive Summary...... 1

Introduction ...... 2

An Overview of the Cruise Industry ...... 3 Consolidation ...... 3 The Market Today ...... 4 Visits to the Maritimes ...... 4

Economic Realities and Dilemmas ...... 6 The Economics of the Industry ...... 6 How Ships Make Their Money ...... 6 How Cruise Lines Save Money ...... 7 Cruise Line–Port Relationships ...... 7 Cruise Line–Port Relationships in the Maritimes ...... 8 Competition Between Ports ...... 9 Port Economics: Shore Excursions and Shops ...... 9 The Cost of Cruise Ship Visits ...... 10

Environmental Realities and Dilemmas ...... 12 Key Environmental Issues ...... 13 Issues Facing the Maritimes ...... 15

Social Realities and Dilemmas ...... 16 Labour Issues ...... 16 Social Justice and Social Responsibility ...... 17 Local Issues ...... 18

Conclusions and Recommendations ...... 19 Business is Business ...... 19 Do You Know What You Are Breathing When A Cruise Ship is in Port? ...... 20 Don’t Forget the Crew ...... 20

Endnotes...... 22 Executive Summary

The Port of Halifax is set to welcome 180,000 in nature. This relates to the sweatshop-like work cruise ship passengers in 2003 – a four-fold in- conditions onboard many cruise ships as well as crease since 1998. To date, there has been a focus the threshold for the number of cruise ship visi- on attracting cruise ship visits. Very little atten- tors that can be accommodated by a community tion has been given to the costs associated with without it having a negative effect. these visits. This paper begins with an overview The paper concludes with recommendations of the cruise industry and its place in the in each of these areas. It encourages communities Maritimes. It then proceeds to discuss issues rel- and ports to work cooperatively in the face of evant to local concerns. There are three main ar- cruise industry efforts to divide and conquer, and eas of interest. The economics of the cruise in- suggests that the region consider a cruise passen- dustry and the economic relationship between ger head tax. It advocates environmental regula- cruise lines and ports is one. Of relevance is how tions that include zero discharge of waste within the cruise industry makes its money and how this 12 miles of the port, use of low sulphur fuel in influences the division of income between onshore order to reduce air emissions, and a ban on incin- businesses and the cruise industry – often to the erator use in port. It cautions against the use of a disadvantage of onshore tour operators and mer- voluntary Memorandum of Understanding be- chants – and the tendency for ports to see the tween the Government of Canada and the cruise cruise industry as a “cash cow.” A second area of industry or the use of “Environmental Guidelines” concern is the volume of waste produced by a as a means for dealing with cruise ship discharges cruise ship and the environmental practices of the and emissions. And it reminds ports not to forget industry as it deals with these wastes. There are the crew. Port cities are well placed, on the one problems with accidental discharges of sewage, hand, to advocate for improved working condi- waste water and oil. And there are issues around tions on ships, and on the other hand, to realize the fact that a cruise ship produces air emissions the economic value of crew members, both indi- equivalent to 12,240 automobiles, 20 tons of solid rectly by what they say to passengers and directly waste per day, and as much as 15 gallons of toxic in terms of what they spend in port. waste per day. The third area of concern is social

Cruising – Out of Control 1 Introduction

Cruise visitors to Halifax have increased more than This paper is first and foremost a primer on 340 percent since 1998. In 2003, the port is ex- the cruise industry. It provides background infor- pected to receive more than 180,000 cruise pas- mation about the industry and a context for un- sengers; this will mean 250,000 people in total, derstanding the impacts of cruise lines that visit including crew. This scale of growth has had posi- Halifax and other ports in the Maritimes. It dis- tive impacts on the city and on the region. The cusses the positive and negative features of the Port of Halifax and the Province are both work- industry, particularly as they apply to port cities, ing to further grow cruise passenger visits. How- and addresses economic, environmental and so- ever, is anyone asking whether Halifax and other cial issues related to the cruise industry. The goal Maritime ports are able to absorb this continued of the paper is to identify issues and concerns that scale of growth? Is this scale of growth desired. In need to be considered by Halifax and other Mari- this paper I seek to provide information that may time ports, and to foster informed decision mak- be helpful in stimulating a dialogue and answer- ing. ing such questions.

2 Canadian Centre for Policy Alternatives – Nova Scotia An Overview of the Cruise Industry

The cruise industry is the segment of the leisure The next wave of growth came with the in- travel industry that is growing the most rapidly. troduction of mega ships. Carnival Cruise Line’s In the 31 years from 1970 to 2001 the cruise in- Destiny, at 101,000 tons and with a capacity for dustry grew in number of passengers served by 3300 passengers was the first in 1997. Princess 1400 percent – from 500,000 to more than 7 Cruises followed with Grand Princess a year later. million North Americans per year. In 2001, more The 109,000 ton vessel accommodates 2600 pas- than 12 million people took a cruise worldwide. sengers. In 1999, Royal introduced Voy- This pattern of growth will continue. Between ager of the Seas. At 143,000 tons, the ship accom- 2000 and 2005, the cruise industry will increase modates over 3800 passengers. With crew, almost capacity by approximately 50 percent – 100,000 5000 people inhabit the ship. These mega ships new beds. To keep up with this growth, it needs are the prototypes on which many new ships are as many as 100,000 new hotel workers every year based. Fourteen new ships accommodating a to- for each of the five years. tal of 30,000 passengers will be introduced in It is not just the number of people cruising 2003; another 10 accommodating a total of that has grown, the size of new ships has also 25,000 passengers are scheduled for 2004. grown. In the 1970s and early 1980s, a typical Mega ships are common visitors to Halifax cruise ship accommodated between 500 and 800 and other ports in the Maritimes, as are their passengers. There were some exceptions, such as smaller cousins that are in the 80,000 to 90,000 Cunard’s Queen Elizabeth II which was built in ton range and which accommodate 2000 to 2500 1969 and accommodates 1600 passengers, and passengers. ’s (built originally as the SS in 1962) which accommodates Consolidation 2000 passengers. However, both of these vessels were built for transatlantic crossings and used While the cruise industry has grown in size (both mainly for transportation rather than pleasure in terms of the ships and number of passengers cruising. served), it has also experienced considerable con- The size of ships built exclusively for the solidation. This began in the early 1990s and con- cruise market began to grow in the 1980s. In tinues today. Brand names that were previously 1985, Carnival Cruise Line introduced Holiday, independent have been bought by larger opera- the first of three superliners. At 46,000 tons, it tors, and many smaller operators have gone out was the largest ship ever built for vacation cruises. of business. In 2000 and 2001, seven cruise com- It accommodates 1500 passengers. Three years panies comprising ten brand names ceased op- later, Royal Caribbean Cruise Line introduced erations. Sovereign of the Seas, a ship weighing in at 73,000 The consolidation of the cruise industry is tons and accommodating as many as 2850 pas- made clearly visible by a cursory review of the sengers. In 1989, Carnival Cruise Line introduced four (soon to be three) main companies operat- Fantasy (the first of eight Fantasy-class vessels). It ing in North America. Carnival Corporation, accommodates 2600 passengers and weighs which began in 1972 with Carnival Cruise Line, 70,000 tons. also owns , Windstar

Cruising – Out of Control 3 Cruises, Costa Cruises, , and The situation in North America underwent Seabourn Cruises. It is expected that Carnival’s considerable change after September 11, 2001. merger with P&O Princess will be complete in Realizing the American public’s resistance to fly- the spring of 2003. P&O Princess itself owns eight ing to ports outside the U.S., as well as the vul- brand names: , P&O Cruises, nerability of the cruise industry to the operation Swan Hellenic Cruises, Aida Cruises, Seetours, of the U.S. air transportation system, most cruise A’Rosa Cruises, P&O Australia, and Ocean Vil- lines redeployed their ships to ports that were lage. The combined company will within driving distance of a large operate 14 cruise lines represent- Between 2000 and enough population that suffi- ing almost 50 percent of the cient passengers could be had North American market. The 2005, the cruise in- without relying on the air lines. other two major players, account- dustry will increase Ports such as Baltimore, Philadel- ing for almost 40 percent of the capacity by approxi- phia, New Orleans and North American market, are Charleston saw their cruise vis- Royal Caribbean Cruises Limited mately 50 percent. its expand; other ports such as and . The former some on the Gulf Coast and west owns Royal Caribbean International, Celebrity coast saw cruise ships planning inaugural visits or Cruises, and Island Cruises (a joint venture with resuming visits that had previously ceased. Most First Choice Holidays). The latter owns Star recently two cruise lines have announced plans to Cruises, Norwegian Cruise Line, and Orient Line. homeport a ship year round in . This expansion of the North American market The Market Today has impacted Canadian ports, particularly in the Maritimes. Cruising has increased in popularity around the world. The industry is booming in Asia, Australia Cruise Ship Visits to the Maritimes and Europe. The U.K., and Italy are experiencing considerable growth in the popular- Halifax began as a cruise port when Commodore ity of cruising. There is also significant develop- Cruise Line’s Caribe, with 303 passengers, visited ment in Spain, but less in France. The European on April 30, 1980. Port activity has grown since, market is somewhat split between those who cruise welcoming 47,000 passengers in 1998. The pas- in Europe on European carriers and those who senger numbers continued to grow – 340 percent cruise the Caribbean and other parts of the world in the five years between 1998 and 2002. In 2002, on carriers that dominate the North American the Port of Halifax welcomed 160,000 passen- market. The expectations of European passengers gers. In 2003, the number is expected to grow are often different from those of North Ameri- another 15 percent to over 180,000. Cape Breton cans, and the ships that serve a primarily Euro- has more recently become a port of interest for pean clientele are distinctly different in décor and cruise lines, welcoming 37,000 passengers in 2001 style. The same is true of ships designed for Asian – a 56 percent increase over the year before. passengers. Norwegian Cruise Line’s “Freestyle Similar patterns of growth are visible for Saint Cruising,” with nine or ten restaurants on a ship, John, New Brunswick and Charlottetown, PEI, while new to North America when it was intro- however each of these ports vary in their own way duced, had been the norm on Star Cruises’ ships from Halifax. Saint John, for example, was a year serving Asian ports. behind Halifax in its major increase in cruise traf-

4 Canadian Centre for Policy Alternatives – Nova Scotia Table 1 – International Cruise Ship Traffic: Halifax and Saint John, 1990 – 2002 Number of passengers x 1000

1990 1995 1996 1997 1998 1999 2000 2001 2002

Halifax 24.4 30.2 36.6 44.3 48 107.8 138.3 160.2 160

Saint John 1.8 12.2 8.5 19.8 28.4 40 101.4 88.2 124

Montreal 30.9 27.4 19.1 29.3 32.6 18.3 25.2 23.9

Source: Transport Canada fic, and then the numbers dipped before going A number of smaller cruise lines also call at back up. Charlottetown remains a relatively small Halifax. There are European cruise ships such as port with 20 or so ships stopping in a good year. Delphin Seereisen, Hapag-Lloyd Cruises, Phoe- Table 1 provides cruise traffic numbers for Hali- nix Reisen, P&O and Fred Olsen Cruises; fax and Saint John; Montreal is included for pur- utraluxury cruise ships operated by Silversea and poses of comparison. Seabourn; and companies that fill a particular Most cruise ships stopping in Halifax and the niche such as Clipper, Cunard, and Regal. The Maritimes in general are on a Canada/New Eng- passengers on these ships vary as much as the ships land itinerary. Circle cruises from Boston or New themselves. Passenger expectations, buying pref- York are the most common. A smaller number of erences and tour choices (including whether to cruises run between Boston or New York and go independent of the cruise ship’s planned ex- Montreal. And a smaller segment again is cruises cursions) can vary widely from one ship to an- that stop in Halifax on a transatlantic cruise. Ma- other. The greatest variations are between U.S.- jor U.S.-based cruise lines with stops in Halifax dominant versus European-dominant ships, and include Carnival, Holland America, Norwegian, between mass market ships versus ultraluxury Princess and Royal Caribbean. ships.

Cruising – Out of Control 5 Economic Realities and Dilemmas

The cruise industry has been more successful for no specified minimum wage, or no labour law. some than for others. Carnival Corporation is not The result is that there is no minimum wage on only the largest in size, but it also generates the cruise ships, no limit to the number of hours per- largest profit. In 2002, the company had a net mitted in a workday, and limited regulation of income of U.S.$1.02 billion on revenues of worker contracts. As is discussed later, wages for U.S.$4.37 billion. Royal Caribbean Cruise Lim- most cruise ship workers are very low by Cana- ited, number two in size, had revenues of dian standards. Workers can work 12 months U.S.$3.15 billion and a net income of U.S.$254 straight without a vacation, 10 to 12 hours per million in its most recent fiscal year. In contrast, day, and receive as little as U.S.$300 or $400 a P&O Princess had revenues of US$2.45 billion month.2 There have been several unsuccessful ef- and a net income of U.S.$301 million while Star forts by the U.S. Congress to bring cruise lines Cruises had revenues of U.S.$1.57 billion and a operating out of U.S. ports under U.S. labour net income of U.S.$82.6 million. laws, however in each case the legislation failed. During hearings before a House committee, the The Economics of the Industry President of the International Council of Cruise Lines went so far as to threaten that the industry Like the shipping industry generally, the cruise would relocate its ships to foreign ports if the U.S. industry is largely foreign-registered. Even though attempted to legislate labour standards on cruise the corporate offices for most major cruise lines ships.3 are in , , and the clientele served is Liability issues are also effected by foreign reg- largely North American, the companies and their istry of the companies and the ships. In the ab- ships are registered in places like Panama, Libe- sence of national legislation, claims related to ac- ria, , and . This arrangement cidents, injuries and deaths on the high seas are provides several benefits to the corporation. The governed by maritime law. In many cases, pas- most visible is that the companies operate free of sengers find that assumptions about liability com- U.S. (and Canadian) taxes. Except for tax on tour mon on land are not applicable at sea. The mat- operations owned and operated in the United ter is made even more complex by the industry’s States (mainly Alaska), neither Carnival Corpo- use of concessionaires for many onboard services ration nor Royal Caribbean Cruises Limited pays and products and the schism on some ships be- any income tax. P&O Princess, which is regis- tween the company selling the cruise and the com- tered in the U.K., reportedly has a tax rate of 5 pany operating the ship. Unbeknownst to many percent based on its worldwide income – 72 per- passengers, the cruise line is not responsible for cent of its income is from North America.1 Star the actions of its concessionaires, including the Cruises has its corporate offices in and practice or malpractice of the physician onboard. its tax payments are not clearly known. A second benefit of foreign registration is that How Ships Make Their Money cruise lines are only required to adhere to the la- bour laws of the country where a ship is regis- Cruise fares are a major source of income; how- tered. In the countries concerned there is either ever, they are not the only source. Fares for cruises

6 Canadian Centre for Policy Alternatives – Nova Scotia have remained depressed over much of the past are economies of scale to be had. As a purchaser decade. Oversupply of berths is one factor, but of a larger volume of a product, a cruise company events such as the Gulf war in 1991, the Kosovo is able to reduce the unit cost of whatever is being conflict in 1999, and the September 11th attack purchased. The scale of saving is not trivial. Both in 2001 have each taken their toll on cruise book- Carnival Corporation and Royal Caribbean ings. With cruise fares kept relatively low, cruise Cruises Limited suggested that their merger with lines have turned to onboard revenue as a source P&O Princess would provide the new company of income and of profit. U.S.$100 million in savings annually from econo- There are a range of sources of onboard rev- mies of scale. Further savings are likely to be real- enue. These include bar sales, gambling, ized by implementing Carnival Corporation man- retail sales in shipboard stores, shore excursions, agement systems in P&O Princess, and with im- spa services, photography, art auc- plementation of e-procurement tions, bingo, extra-tariff restau- For some companies, programs.6 Royal Caribbean rants, and phone and internet ac- shore excursions – Cruises Limited introduced an e- cess. It was reported in 1999 that procurement system in 2001 and the industry averaged between the shore side tours anticipated that its overall savings U.S.$220 and U.S.$232 per day sold onboard the in purchasing costs could be as per person in onboard spending.4 ship – are the largest high as U.S.$100 million per year. With increases, the figure today The increasing purchasing power likely approaches U.S.$300 per growing source of of cruise companies has a direct day per person – more than the onboard revenue. impact on suppliers and shore ex- vast majority of people pay for the cursion providers. A large com- cruise itself. pany commanding so much business from sup- For some companies, shore excursions – the pliers is able to extract prices that provide mar- shore side tours sold onboard the ship – are the ginal profit for the suppliers. This is particularly largest growing source of onboard revenue. Be- the case with shore excursion providers. Several tween 1996 and 2001, Holland America Line re- companies may compete for a cruise line’s busi- ported that its per capita income from shore ex- ness and are forced to undercut one another in cursions had increased 73 percent.5 While the order to win a contract for the line’s business. The cruise line’s income increases, the same may not result is that the cruise line (or its concessionaire) be the case for the merchant providing the actual buys shore excursions at very attractive prices and tour. The merchant is often paid only a fraction then sells them to passengers for as much three of the money collected by the cruise line for the times the amount paid to the shore excursion pro- tour – sometimes as little as a third or a quarter of vider. Given the volume of business, many the actual revenue. This is discussed further be- shoreside businesses are left in a position of either low. selling their product cheaply or not selling it at all. How Cruise Lines Save Money Cruise Line–Port Relationships Another way that a cruise line can improve the economic bottom line is to reduce costs. Con- The relationship between cruise lines and ports is solidation in the industry has been a major force shaped by a perception by many ports that cruise in this regard. With increasing corporate size, there ship visits are a major economic value and should

Cruising – Out of Control 7 be sought at almost any cost. The overriding view- flecting a 50 percent increase in capacity – that point is that the port needs the cruise line and cruise lines need new ports as much if not more that if one cruise ship visits others will follow. than the ports need them. Ports continue to build Interestingly, successful ports have a slightly dif- new piers and terminals to both attract cruise ships ferent perception. A , Florida city com- and to keep them coming back. They also absorb missioner recently observed: “We need to stand considerable costs. In 2003 the Port of Portland, back and evaluate where we are at and make sure Maine, is faced with spending U.S.$1.2 million we are controlling the cruise ships and they aren’t in waterfront improvements, most of which is nec- controlling us.”7 This observation gets at the crux essary because of wear and tear from cruise ships. of the issue: in looking at cruise line – port rela- This expense compares to U.S.$295,000 income tionships: one must step in 2002 from cruise ship back and ask, “Who needs Ports often find that the in- docking fees.9 The port ap- who?” come expectations are over- pears to be coming out on Ports have traditionally the short end. However, provided cruise lines with blown and the costs of hosting Portland is not alone. Many considerable concessions a cruise ship are under-stated. cities are building and ex- and allowances in order to panding piers and terminals attract their business. Panama, in 2001, went so in order to attract cruise ships, assuming that they far as to offer a bounty to cruise ships for every will generate considerable income. Instead they cruise passenger landed at a Panamanian port. The find that the income expectations are overblown bounty increases to as much as U.S.$12 per pas- and the cost of hosting a cruise ship are under- senger depending on the number of passengers stated. landed – the more brought, the higher is the per person bounty. Other ports – most recently San Cruise Line–Port Relationships Juan – have entered into arrangements whereby a in the Maritimes cruise line is given a waiver of a portion of the port charges in return for investment in the con- Halifax and the Maritimes in general occupy a struction or renovation of a cruise terminal. Such unique position in one regard. With cabotage laws a plan was in place for St. Thomas in the U.S. that require a foreign-flagged ship sailing from a Virgin Islands, but was cancelled at the last minute U.S. port to include a foreign port in its itiner- by the territorial government when it realized that ary,10 ships sailing north from New York or Bos- it would be economically better off to receive the ton must stop at least at one Canadian port. This full port charge and to undertake the port devel- is most frequently Halifax, but to meet U.S. law, 8 opment on its own. The current ongoing devel- it can be any port in the Maritimes. There are opment of a port at XCaret (near Cancun) by occasional discussions, both in Canada and in the Carnival Corporation is another variation in the U.S., about eliminating cabotage laws – some- pattern of a port giving away much in its effort to thing the cruise industry would like to see. This attract cruise ships. Ports too often perceive that type of policy change would likely have a signifi- they need the cruise ships more than the cruise cantly negative impact on cruise ship visits to lines need them. Halifax and the Maritimes. Ports have not yet realized that with the re- Otherwise, the relationships between ports in cent expansion of the cruise industry – an increase the Maritimes and the cruise industry are not of 100,000 berths between 2000 and 2005, re-

8 Canadian Centre for Policy Alternatives – Nova Scotia unlike those in other areas. There is a general per- for example operates three itineraries that include ception that successfully securing cruise ship vis- stops in Halifax (see Table 2) – these represent its is like catching a “cash cow” – it is assumed one-third of all cruise passengers visiting Halifax. that there is much money to be made with very While Halifax is part of each itinerary, Saint John little cost. There is also a perception that the cruise and Sydney are included in only one of the three. lines are continually looking for new ports. The The success of Digby as a port in this case de- expectation of economic windfalls is inconsistent pends on its ability to take the business away from with the experience of most ports. That cruise lines Saint John; the success of Charlottetown depends are looking for new ports is correct to some ex- on taking business away from Sydney. The cruise tent, but their choices and decisions are based on line can be easily sold on shifting from one port broader issues related to itinerary planning and to another if there are adequate economic ben- economic factors associated with the port call and efits. Ports are in effect put into the position of the time at sea before and after the call. The cruise competing for the finite business available from line is concerned about the potential income from the cruise line. the port call, the potential costs associated with The competition between ports of call is par- the stop, and the income that can be generated ticularly evident at the annual Seatrade Cruise onboard prior to and following the call. Shipping Convention, the industry’s annual con- ference and trade show. The dominant feature of Competition Between Ports the trade show is the number of ports with exhib- its used to familiarize cruise executives with what There have been several ports in the Maritimes the port has to offer – virtually every port that that have attracted cruise ship visits, including welcomes cruise ships or that desires cruise ships Halifax, Saint John, Sydney and Charlottetown. is present. The cost of their presence isn’t trivial. The success of these ports is a combination of Registration fees for exhibitors are significant their geographic position (i.e., their proximity to (US$1000) as are the cost for rental of a booth an embarkation port such as Boston or New York (beginning at U.S.$15,000).12 While ports invest and that their distance from one another is great considerable sums to be present at the Seatrade enough to justify cruising but not so far enough Convention, the actual value of their presence is apart that the cost for fuel to travel from one to hard to gauge.13 another would be too great), what they have to offer to day visitors, and the economic bottom Port Economics: line. Other ports have attempted to attract cruise Shore Excursions and Shops visits. Digby is one that comes to mind given the amount of money and time they have spent on Another feature of the relationship between the the effort and yet to no avail.11 The simple reality cruise industry and the Maritimes is the econom- is that a new port’s success will likely be at the ics related to shore excursions and onshore shops. expense of an existing port. Carnival Cruise Line Each of these is a source of income for a cruise

Table 2: Carnival Cruise Line Calls: Halifax, 2003 4 night NY – Sea – Halifax – Sea – NY 5 visits in 2003 5 night NY – Sea – Saint John – Halifax – Sea – NY 11 visits in 2003 7 night NY – BOS – Portland – Sea – Sydney – Halifax – Sea – NYC 4 visits in 2003 Source: Carnival Cruise Line ( www.carnival.com )

Cruising – Out of Control 9 ship. Shore excursions provide profit through the ping program is arranged by a concessionaire that mark-up added by the cruise line to the price is responsible for shore excursions and lectures charged by a local tour provider. The mark-up about the port. The two largest companies in- can be as much as three fold – a shore excursion volved in shopping programs are the PPI Group costing a passenger U.S.$50 is likely to yield (Panoff Publishing) and OnBoard Media (a sub- Cdn$25 to the shore excursion provider.14 The sidiary of Louis Vuitton Moet Hennessey). provider and the port are in the difficult position A key element of both the shore excursion of having the passenger expect a product worth program and the shopping program is that only a U.S.$50, but having only Cdn$25 to provide the portion of money spent by passengers remains product. Dissatisfied passengers are onshore. Thus, while most ports more likely to blame the tour op- assume that passengers spend on erator or the port than the cruise Ports are in effect put average between U.S.$85 and line from which the tour is pur- into the position of $100 per port call, these figures are chased. Shore excursions in Hali- competing for the fi- not adjusted for the amount that fax range in cost from U.S.$24 for nite business available remains in the port and the a two hour walking tour of the Pub- from the cruise line. amount that goes to the cruise line lic Gardens to U.S.$249 for a six and/or its concessionaire. hour “Soldier for a Day Interactive Tour.” Table 3 lists the tours offered by Holland America Line. The Cost of Cruise Ship Visits Onshore shops are another source of income for the cruise line. Most cruise lines have shop- Ports often overlook some of the hidden costs as- ping programs which includes a map of the port sociated with cruise ship visits. These vary from that has marked “approved stores.” These stores one port to another, but generally a port city is pay a fee (sometimes a flat fee; other times a per- required to deploy more police during a cruise centage – as high as 40 percent — of gross sales15) ship visit, and the city will be faced with cleanup to be included on the list. In most cases, the shop- Table 3: Holland America Line’s Shore Excursion Offerings for Halifax (2003 season) Shore Excursion Length Cost (hours) U.S.$ Cdn$ Artists & Artisans Gallery Tour 3.75 $69 $105 Cloud Nine--Nova Scotia Flightseeing 2.5 $199 $302 Garden & Garrisons--A Relaxed Walking Tour 2 $24 $37 Halifax 1900 3 $49 $75 High Tides & Fine Wines 7.5 $99 $150 Historic Halifax by Amphibious Harbour Hopper 2 $44 $67 Lunenburg & Mahone Bay with Halifax Highlights 6.5 $49 $75 Peggy's Cove & Lobster Lunch 6 $79 $120 Peggy's Cove Lighthouse Route 3.75 $49 $75 Queen's Shilling Interactive Tour 3 $89 $135 Soldier for a Day Interactive Tour 6 $249 $379 The Heart of Halifax--A Historic City Tour 3.25 $39 $59 Titanic Tour: The Halifax Connection 3 $44 $67 Source: www.hollandamerica.com/servlet/PortOfCallDetailBuildServlet?nbrDest=055000&codePort=YHZ (accessed March 13, 2003)

10 Canadian Centre for Policy Alternatives – Nova Scotia and collection of more than the usual amount of be minimal, but the cumulative impact that comes garbage. The costs for these civic services vary – with 180,000 passengers cannot be viewed as they are greater for large ships than small ships, trivial. And then there is the environmental im- and greater on days with multiple ships than on pact of both the ships and their passengers. These days with single ships – but they are an often un- costs also need to be identified and taken into seen and added cost of a cruise ship visit. account. It is also necessary to consider the cost of wear The need here is to recognize the costs of and tear on the infrastructure. Cruise passengers cruise ship visits and to weigh them against the take tours using buses and taxis, they use trans- benefits. This exercise allows a port city to ensure portation services, and they use toilets. The indi- that it is not unnecessarily subsidizing the cost of vidual impact of a passenger or even of a ship may a cruise ship visit.

Cruising – Out of Control 11 Environmental Realities and Dilemmas

Environmental issues are of key importance when Cruise Ship Wastes considering the cruise industry and its impact. While the industry projects an image of environ- There are seven main sources of waste from cruise mental responsibility and claims that it is “green,” ships. These include: the fact is that cruise lines have paid more than U.S.$60 million in fines in the past five years, Black water is the waste that goes down toilets. A and more than U.S.$90 million in the past dec- ship produces ten gallons of sewage per passenger 16 ade. All of these fines are for environmental vio- per day. The typical ship visiting Halifax produces 17 lations. With few exceptions, the U.S. is the only more than 40,000 gallons of sewage every day. country that has actively enforced environmental There are no Canadian laws that explicitly con- regulations through the use of fines. More often trol discharge of black water. In the U.S. it is le- than not the fines have not been for discharge of gally discharged three miles from oil or hazardous waste, but for fal- A ship produces ten shore. International regulations sifying records relating to the dis- that would set a 12 mile limit are charge of these pollutants. The gallons of sewage per not yet in effect.19 In spite of U.S. scale of the problem is reflected passenger per day. regulations, Regal Empress dis- in the recent case involving Nor- charged sewage into the harbour wegian Cruise Line and S.S. Nor- of Portland, Maine, during the 2002 season.20 way and the Norwegian Majesty. “Environmental Protection Agency agents say – and court records Grey water is the wastewater that goes down the support – that the Norway not only poured hun- sink and showers, the wastewater from the galley, dreds of thousands of gallons of oily bilge water and from the spa and beauty parlour. A ship pro- into the ocean. It also dumped raw sewage mixed duces 90 gallons of grey water per person per day. with hazardous, even cancer-causing, chemicals The typical ship visiting Halifax produces more from dry cleaning and photo development into than 360,000 gallons of grey water per day. There 18 the waters near Miami for many years.” are no national or international regulations that The other major players in the cruise indus- control the discharge of grey water. A cruise ship try – Carnival Corporation, Royal Caribbean purportedly discharged grey water into the Port Cruise Limited and P&O Princess – have each of Vancouver during the 2002 season.21 In Janu- had their share of offences and fines. Interestingly, ary 2003, the Carnival ship Ecstasy accidentally none has been charged with offences in Canadian discharged grey water while anchored a half mile waters. As often pointed out by Alaskans, it is hard off Santa Catalina Island (off the west coast of to believe that the ships would dump sewage and California).22 other waste in Alaska’s waters and not in British Columbia’s Inside Passage where regulations are Garbage and solid waste A cruise ship produces less stringent and enforcement less vigilant. 3.5 kilograms of solid waste per passenger every day.23 The typical ship visiting Halifax produced 14,000 kilograms of solid waste every day. Some

12 Canadian Centre for Policy Alternatives – Nova Scotia of this is retained onboard and landed onshore birds a year are killed by bilge from ships (not for recycling, some is incinerated, and some (in- only cruise ships).26 cluding food waste) is ground and discharged at sea. Because plastics are often incinerated, dioxins, Ballast water is used by a ship for stability. It will furans, and heavy metals are released into the air. take on ballast to offset the weight of fuel that has In addition, because the incinerator ash is dumped been consumed, and for stability during voyages. at sea, there may be particles of plastic included A cruise ship releases ballast water when it enters in the discharge, as well as dioxins and other ports. Each release can be up to 1000 metric tons chemicals. of ballast water, literally millions of gallons. Bal- last water is a concern because it introduces non- Hazardous waste A typical cruise ship produces native species – bio-invaders as they are called in 15 gallons of toxic waste every day. These include a Globe and Mail article27 – to areas of discharge. dry cleaning sludge, photofinishing chemicals, The Government of Canada has recognized the paint waste and solvents, print shop waste, fluo- problem and has promulgated federal marine rescent lamps and batteries. While the cruise in- guidelines, but these have been opposed by ship- dustry has mandatory regulations controlling the ping interests. California legislated a prohibition discharge of toxic waste, these regulations (prom- of release of ballast water into its waters. Since ulgated by the International Council of Cruise this legislation came into force in 2001, two-thirds Lines) do not include monitoring for compliance, of cruise ships have ignored and violated the law.28 nor do they require penalties when they are vio- lated. There continue to be occasional cases where Diesel exhaust emissions A cruise ship produces hazardous waste becomes known to have been im- roughly the equivalent in exhaust emissions as properly handled. In December 2001, Celebrity 12,240 automobiles. A study in Vancouver Cruises’ Zenith offloaded a 55 gallon drum of showed that large ships (not only cruise ships) hazardous waste at Tampa, Florida, but the drum “…are responsible for 58 percent of greenhouse was not labelled as containing hazardous waste.24 gases over the city and 95 percent of sulphur com- There was no penalty. pounds, a major cause of smog and the cause of acid rain … A single large ship visiting port could Oily bilge A cruise ship produces 7000 gallons of pump out as much sulphur dioxide as 2000 cars oily bilge water every day. Oily bilge is a combi- and trucks driving all year round.”29 Given the nation of the water that collects in the of the experience in Vancouver, Environment Canada ship from condensation, water-lubricated shaft plans to monitor emissions in 2003 to assess the seals, propulsion system cooling, and other en- amount of sulphur oxide and nitrous oxide going gine sources. It contains fuel, oil, wastewater from into Halifax’s air. Reduction of both sulphur ox- engines, and may include rags, metal shavings, ide and nitrous oxide can be easily achieved when paint, glass and cleaning agents. If filtered to 10 ships use low sulphur fuel. to 15 parts per million (ppm) of oil, the water can be legally discharged into the ocean. The Re- Key Environmental Issues gal Empress discharged 200 gallons of oil into the harbour at Portland, Maine. It paid a fine of There are several salient environmental issues re- US$50025. On the east coast of Canada, 300,000 lated to the cruise industry. Two relate to plans afoot within the Canadian Government. First, it has been suggested that new Canadian regulations

Cruising – Out of Control 13 will not define as sewage the effluent from a cer- treated sewage, and oily bilge in the Monterey tified Marine Sanitation Device. However, it is a Bay National Marine Sanctuary on October 9, leap of faith to assume that the effluent from these 2002. Prior to the visit, the company had given a devices meets minimum standards. Monitoring written pledge that it would not discharge any- done by the State of Alaska in 2000 led the Juneau thing into the Sanctuary, however the discharge Port Commander for the U.S. Coast Guard to came to light in late February after the State of question whether the Coast Guard approval of California requested a copy of the Crystal Har- these systems was valid. The Governor of the State mony’s log books. The company explained that of Alaska called the findings “disgraceful and dis- they didn’t disclose the discharge when it hap- gusting.” Alaska’s experience suggests that these pened because it had only broken agreements, not systems must be regularly monitored if a jurisdic- any laws. As a result of the discharge, the Crystal tion wants to ensure that the effluent meets local Harmony has been banned from any future visits standards. It also indicates the need for equal con- to the Marine Sanctuary. 32 cern about grey water as black water. Monitored Two other key concerns that indicate the need samples consistently indicated that grey water had for monitoring of emissions relate to hazardous fecal coliform counts and levels of total suspended chemicals and oily bilge. While the cruise indus- solids that were the same as in black water (sew- try insists that these are both disposed of prop- age). 30 erly, recent fines and violations33 suggest that the A second move afoot is discussions between industry’s word may not be enough. If a govern- the cruise industry and the Government of ment wishes to prevent discharge of these sub- Canada toward a Memorandum of Understand- stances, then it must be prepared to monitor for ing (MOU), but in Canada’s case it would be con- violations and to prosecute violators. tained in “Environmental Guidelines for the Although the federal government has identi- Operation of Cruise Ships in Coastal Areas.”31 fied both ballast water and air emissions as po- These guidelines were promulgated in consulta- tentially harmful, regulations for either may be tion with the cruise ship industry, but there has some time off. Local authorities should consider been limited opportunity for public comment. taking their own steps to prevent the release of They have the industry commit to minimum en- ballast water. They can also easily require that ships vironmental standards (in some respects less strin- use low sulphur fuels when approaching and in a gent than regulations in place in Alaska), but they port. This practice is not uncommon: it has been do not include provision for the Canadian Gov- a requirement for many years in Bermuda, was ernment to regularly monitor cruise ship emis- introduced in Alaska during the past couple of sions and to enforce through penalties infractions years, and in the summer of 2003 will be required of standards set out in the regulations. Hawaii of ships using the new cruise terminal at Seattle. entered an MOU in 2002 and by February 2003 Several ports (Los Angeles and San Francisco in the state legislature had before it three bills that particular) are also looking to reduce air emissions would legislate environmental standards for the by having the capability for cruise ships to plug cruise industry. into the local power grid when in port. This means The lack of legal force of the MOU approach they can shut down all engines during their port is reflected in a recent disclosure that Crystal call. Princess Cruises does this when in port at Cruises discharged 36,000 gallons of wastewater, Juneau.

14 Canadian Centre for Policy Alternatives – Nova Scotia Issues Facing the Maritimes seem to be effective. Programs that have included monitoring have demonstrated: 1) that cruise Several of these environmental issues are relevant ships fairly quickly change their practices in or- for Halifax and other ports in the Maritimes. Most der to meet local requirements (often moving their notably, there can be greater effort to control and cleaner ships where they are required, which leaves manage the release of ballast water, wastewater “dirtier” ships where regulations are not in place); and air emissions. In some cases these can be han- and 2) that even with clear and reachable guide- dled by the local or provincial government, ei- lines, some ships continue to violate standards ther through legislation or through enforcement either intentionally or by accident. In 2002, moni- of regulations already on the books. In other cases, toring in Alaska found one ship producing efflu- it may require a voluntary but enforceable agree- ent with fecal coliform counts that were too high.34 ment with cruise lines. The port’s power of en- As discussed above, another ship discharged forcement comes with its authority to deny pier 40,000 gallons of partially treated sewage into space to a ship that does not meet minimum Juneau harbour, and contrary to the industry’s standards set by the port. Ideally, it would be pos- mandatory regulations, there were discharges of sible to commit to an agreement between the grey water by a cruise ship in Vancouver harbour cruise line and the port or the city. Individual and off Catalina Island, California. These are cases agreements were used in 2002 and will be used in that have been reported; we have no way to know 2003 in Monterey Bay, California. Cruise lines how common these occurrences are. agreed to no discharges while in the sanctuary. The bottom line is that monitoring cruise There are other areas where laws need to be prom- ships is a necessary part of welcoming the indus- ulgated. In these cases, cruise port cities need to try to a port. One needs to keep in mind that join together to collectively protect their greatest three of the four major cruise companies are con- asset – a clean and attractive port. victed environmental felons, with those convic- No matter what regulations or policies are in tions occurring since 1998. The fourth line (P&O place, the largest issue facing any port is the need Princess) has also been convicted of a felony for to monitor cruise ships for their emissions and environmental violations, but its case dates back their practices. Schemes that are voluntary do not to the early 1990s.

Cruising – Out of Control 15 Social Realities and Dilemmas

Cruise ships also present a number of social is- documented Maitre d’s who have earned between sues which ports must deal with. Some issues re- U.S.$14,000 and $20,000 a month by taxing the late to the ship itself, some relate to the interac- tips of their workers.37 These workers may also tions between people from the ship and those in have to share tips with other workers, such as with the community, and some (such as people pollu- the laundry workers if a room steward wants her tion)35 relate to the port itself. They point to the or his linens earlier in the day rather than later, need to be proactive regarding social issues as well and with workers in the galley if a waiter wants environmental and economic issues. her or his food hot. Incomes are also difficult to gauge because Labour Issues many workers from non-industrialized countries use a recruiting agent to arrange a job with the The largest social issue relating to cruise ships cruise line. Though against International Labour concerns onboard workers. While officers, cruise Organization rules, these recruiting agents often staff and entertainers, and charge for their services. The many of the concessionaires The norm among service fees can be as high as onboard a ship earn reason- workers on a cruise ship is U.S.$1500 or $2000, plus the able incomes by North Ameri- transportation cost to the can standards, the vast major- to work an 80 hour week. ship.38 The result is that work- ity of workers have incomes ers may spend the first half of that are deplorable by Canadian standards. Line their contract paying off the debt they incurred workers (including cleaners and deck and engine to take their job. room crew) earn as little as U.S.$400 per month. Working conditions are also difficult on a Waiters, waiters’ assistants, and room stewards cruise ship. The norm among service workers on often earn U.S.$50 a month salary which means a cruise ship is to work an 80 hour week; among the bulk of their income is derived from tips. Even deck and engine workers the norm is 66 hours a then, 16 percent of cruise ship workers earn less week. These are minimums.39 Most waiters on than U.S.$500 a month; more than half earn less cruise ships typically work 12 to 14 hours a day, than U.S.$1000 a month.36 7 days a week, for 10 to 12 months without a day The issue of low income levels is compounded off. The contract length is shorter for workers from by a system of taxing tips often found on cruise industrialized countries; it can be as short as three ships. A worker may be expected to pay off her or months for officers.40 his supervisor (the Maitre d’ or Chief House- Aside from the pace of work and low remu- keeper). In the dining room, the amount paid can neration, workers also deal with living conditions correspond with the number of passengers a waiter that are basic, but generally adequate. Tensions is assigned to serve, the class of cabin from which between staff are not uncommon, and those who these passengers come, and sometimes even the are lower in status or function among the crew distance from the galley. Presumably, the higher may experience sexual oppression and exploita- the tips received, the more a waiter pays. The In- tion – both men and women, although the prob- ternational Transport Worker’s Federation has lem is more prevalent for women.41 Given the

16 Canadian Centre for Policy Alternatives – Nova Scotia desire of the employer to keep costs down, the If one’s notion of social justice is more pro- food served in the crew galley is also subject to gressive, then the cruise industry poses some seri- cost saving measures. ous concerns. Its environmental practices are an Simply stated, the modern cruise ship resem- issue, as has already been addressed. Its labour bles a sweatshop. Residents of Halifax perhaps practices are also an issue. Given the industry’s caught a glimpse of this in September 2000 when use of flags of convenience, and the power held Premier Cruises went bankrupt and left hundreds by the employer by virtue of being able to fire a of workers stranded at the port. Thanks to the worker without cause, our ability to change mat- Canadian courts, these workers were the first of ters is somewhat limited. Attempts by Congress Premier’s work force to be paid back salaries to bring cruise ships operating out of U.S. ports (amounting to $745,000) and re- under U.S. labour law have been patriated home. Workers on the Simply stated, the unsuccessful. other Premier Cruises’ ships were modern cruise ship re- If we want to help, we not as lucky. Some remained can learn more about the local onboard ship for months and in sembles a sweatshop. Seafarer’s Mission. We can sup- some cases never were fully paid. port organizations such as the In- The Premier Cruises ship (the Seabreeze) left Hali- ternational Transport Workers Federation (ITF) fax in December and it sunk off the coast of New and War on Want. Together these organizations Jersey in high seas. The few crew members aboard launched a “Sweatships” campaign in September were safely rescued. 2002 which is directed at raising public aware- ness of the problem and ultimately effecting Social Justice and Social Responsibility change.42 We can also engage in direct action. We can apply pressure on individual cruise lines di- Judgements about social dilemmas associated with rectly, or we could form a coalition of local la- the cruise industry depend largely on one’s atti- bour unions to express disapproval of work con- tude about social justice and social responsibility. ditions on cruise ships. This is particularly rel- The owners of the cruise companies would argue evant for Halifax given that Carnival Cruise Line that they are socially responsible: they pay their is one of two major cruise lines (Disney Cruise workers at a better rate than the workers would Line being the other) that does not have an ITF- earn at home, they have a U.S.$20 billion impact approved contract for its workers. These contracts on the U.S. economy, and they bring money to provide some protection, but they still allow 14 the ports they visit. This is partially true. Cruise hour work days, 7 day work weeks, and contracts lines even make donations to local charities in of 10 months, and their income figures are not some ports, but it is not unconditional. This be- always realized. came apparent after Juneau, Alaska, passed a Another issue relevant to social justice is the U.S.$5 head tax for cruise passengers in 1999. fair treatment of the port. It is necessary to keep Holland America Line announced that it would in mind that the cruise line is in business to make cut its support for all charities. In spring 2002, money. Judgements about ports of call are largely Royal Caribbean announced that it was ending economic decisions – will the ship earn enough contributions to Juneau charities because of the money from the port call to make the stop profit- uncertainty in the industry caused by September able. This economic bottom line means that lo- 11. cal merchants – stores, tour operators, restaurants – are often squeezed for their best possible price

Cruising – Out of Control 17 by the cruise line. And while the local merchant passengers or more per day during peak summer pays tax on her or his portion of the income, the months. St. Thomas in the U.S. Virgin Islands cruise line walks away paying no taxes at all. can receive as many as 13 cruise ships with more than 20,000 visitors in a single day. On Decem- Local Issues ber 26, 2000, Cozumel, Mexico welcomed 16 cruise ships with close to 40,000 passengers. In The economic realities and dilemmas around each of these settings, local residents have a love- shore excursions have already been discussed. hate relationship with the cruise ships. They real- However what has not been addressed is the so- ize that the ships are a source of income, but they cial impact on local merchants and tour opera- also resent losing their quiet town and lifestyle. tors who earn less than expected, and who earn This number of passengers raises concerns about considerably less than the cruise line, for the prod- the impact on local communities of large, short- ucts they provide. The competition that leads to term transient populations. It also points to the undercutting prices could have a detrimental im- need to be proactive regarding social issues as well pact on the local business community. environmental and economic issues. A second issue concerns the costs associated This applies to Halifax and other Maritime with the use of local services by cruise ships and ports insofar as asking, “What is the realistic limit their passengers. These include wear and tear on to the number of cruise passengers that we can infrastructure – sewage and water systems, roads receive in a single day?” The answer depends on and paths – as well as the opportunity costs asso- having enough tour operators and buses as well ciated with the need for increased police, sanita- as the number of people that can comfortably be tion, and other government workers associated absorbed in downtown Halifax, at Peggy’s Cove, with a cruise ship visit. Until one knows these and at other common sites visited by cruise pas- costs it is difficult to make a statement about op- sengers. I suspect that the maximum number has portunities lost. not yet been reached (although at times maybe The largest social issue in many places is what approached), which makes this an excellent time may be termed people pollution. The issue of peo- for considering how large one wants the cruise ple pollution is not yet an issue in Halifax or other industry to become in the local area. A proactive Maritime ports, but established ports are increas- review could enable Halifax to avoid the strug- ingly confronted by the problem. At the extreme gles already discussed in relation to Key West, and are places like Skagway, Alaska, a town of 1200 many of the struggles in Alaska where the indus- that can have 10,000 cruise passengers in a day. try has grown beyond local tolerance. Juenau, a town of 30,000, similarly has 10,000

18 Canadian Centre for Policy Alternatives – Nova Scotia Conclusions and Recommendations

It is realistic to view the cruise industry as an eco- it is receiving its fair share of cruise passenger in- nomic benefit to Halifax and to the Maritimes. come by working as a community. However, it is necessary to be sober in approach- This cooperation is also necessary between ing the business relationship. The downsides and ports. The simple reality is that there are a finite other issues need to be considered. Three issues number of cruise ship port calls to the region. require discussion: the nature of business, envi- The choice of one port means a negative choice ronmental issues, and issues related to the crew. about another. For example, a cruise ship call at Digby is likely to pre-empt Saint John. Because Business is Business one port’s gains are another’s losses, there is value in cooperating with one another. For one thing, There is no question that cruise ships bring money each can avoid being played off against the other to local businesses and merchants – to some more to the benefit of the cruise line. than to others. However, tours and shore side ac- There could be a degree of financial coopera- tivities are often dominated by a single company tion among ports. For example, a nominal regional that is able to underbid others and thereby have port fee that is shared between all ports could be the contract for providing shore excursions. As instituted. Even ports with few to no port calls well, local businesses may be pitted against one would have monies to support local tourism sites. another, to ensure the lowest possible prices. They Such fees are not unheard of. Some Caribbean may endure threats that business will go to a com- states have fees over and above dockage fees. petitor unless they make further concessions. Lo- Juneau, Alaska, introduced in 1999 a U.S.$5 head cal stores listed as “Approved” on shopping maps tax for cruise passengers, and the State of Alaska given out onboard cruise ships may pay a flat fee has considered several times a state tax of $50 per or a percentage of gross sails. This is all part of passenger to cover all Alaska ports. The Maritimes doing business in a market economy. However, might consider instituting a nominal head tax for the lower prices do not mean lower prices to the the region. consumer – the cruise line is simply increasing its profit. Recommendation: When bringing cruise ships in, cities and provinces often forget about what Recommendation: There is great value to be had can be earned directly from a cruise ship visit. by merchants and tour operators in ports in the Aside from port fees, there is opportunity for sale Maritimes building a cooperative relationship. of services to the cruise ships. Fuel and provisions There should ideally be agreed upon minimums are obvious items that can be sold, but there are so that one operator can be secure in knowing others. A reception facility for waste (hazardous that it will not be undersold by another. As well, and non-hazardous), for example, is a potential stores may agree on an upper limit for fees paid income source. Providing a hook up to the shore to be on cruise ship maps. The key point here is side power grid for ships in port is another source that the cruise lines will exploit divisions in the for income. community and between companies for its eco- While port officials and government should nomic advantage. The community can ensure that be excited about cruise ship visits, they must keep

Cruising – Out of Control 19 in mind that just as the cruise line views the prov- and is being explored by both Los Angeles ince and city as a source of income, the province and San Francisco. and city need to see the cruise ship as a source of income. Look beyond the amorphous economic The cruise industry is likely to argue that these impact figures (based on an arbitrary $100 spend- matters are best resolved through a Memorandum ing per passenger) bantered around and consider of Understanding (MOU) between the cruise in- the direct economic cost of having ships present, dustry and the Government of Canada or by “En- the potential to recover those costs, and the pos- vironmental Guidelines.” Representatives will ar- sibility to earn some money. Sources of income gue that MOUs have been agreed to in Hawaii may be a combination of sales of services and and Florida, and that the terms of these MOUs modest port fees. put into place practices already in place in Alaska. However, left out of this argument is that Alaska’s Do You Know What You Are Breathing regulations provide for direct monitoring of cruise When a Cruise Ship is in Port? ship effluents and for enforcement and clear pen- alties for violations. An MOU does not include There are a number of environmental issues and provisions for monitoring or for meaningful en- concerns surrounding the cruise industry. Hali- forcement. Guidelines are even less enforceable. fax and other ports in the Maritimes can take les- It is in the interest of local communities to 1) sons from other locales, including Alaska, Cali- ensure that Canada’s ocean environment is pro- fornia, and Washington state. tected from the cruise industry by more than vol- untary and unenforceable measures; 2) take steps Recommendation: Consider the need for: to decree no-discharge zones to areas around and 1 No discharge zones up to 12 miles from the within harbours; and 3) have the Canadian Gov- coast line. This would prevent discharge of ernment promulgate regulations, with the force sewage (treated and untreated), grey water, of law, that set clear standards for cruise ship dis- oily bilge and ballast, and anything else from charges to the air and the water and which in- the waste stream. It is a reasonable request, clude regular monitoring for compliance and but it is in stark contrast to current Canadian impose real and significant penalties for non-com- law that does not explicitly prohibit discharge pliance. of sewage by cruise ships and that has only Don’t Forget the Crew limited prohibitions applying to garbage.43

2 The requirement that air emissions be cur- There are several reasons to not forget the crew. tailed when within 12 miles of the port. This On a purely humanitarian level, we can advocate would include the use of low sulphur fuel and for improved working conditions on cruise ships, refraining from using the ship’s incinerators as on other ships. while in port. Recommendation: Support the efforts of the In- 3 Securing the funding and making arrange- ternational Transport Workers Federation (ITF) ments so that Halifax has the capability for and War on Want to improve the working condi- ships to plug into the local power grid. This tions on cruise ships and ensure that all cruise would allow a ship to shut down all engines ships that use Maritime ports have ITF approved while it is in port. This is available in Juneau contracts for workers.

20 Canadian Centre for Policy Alternatives – Nova Scotia Crew members also contribute to the local lecting a usage charge), and 2) having easy access economy. They do this indirectly by the impact to stores that sell everyday items such as deodor- they have on passenger expectations and feelings ant, soap, toothpaste, etc. I have seen shuttles run- about a port by what the crew say before arriving. ning full every 20 minutes from a ship to the lo- Ports that they personally like are presented dif- cal shopping centre. The shuttle between the har- ferently by crew than ports they do not like. These bour and the mall in Juneau is always crowded. messages influence passengers. The simple fact is that crew are an economic value. Their value may potentially be equal to or Recommendation: A port can impact crew per- greater than passengers. At least whatever they ceptions by 1) having enough telephones avail- spend stays in the area. Local stores should be able for them to call home (local telephone com- encouraged to develop programs that recognize panies often resist having enough telephones be- and provide products and services to crews. The cause the crew normally use telephone credit cards service is of value to the crew and a benefit for or calling cards which means that the local com- local business. pany is providing the equipment but is not col-

Cruising – Out of Control 21 Endnotes

1 Michael S. Sesit, “U.S. Tax Proposals May Squeeze struction costs of the Digby Heritage Centre, less Multinationals,” Wall Street Journal, August 9, 2002, than half of the project’s cost. In announcing the C 14. funding, the Port of Digby Cruise Association stated 2 For more background and detail see Kirk Nielsen, that the Centre would be a staging area for cruise “The Perfect Scam: For the Workers Life is no Car- ship passengers. They expressed the hope that five nival, Believe it or Not,” Miami New Times, Febru- or six cruise ships would visit in 2001 and more than ary 3-9, 2000; International Transport Workers Fed- 10 in 2002. To date, their efforts have been unre- eration, “The Dark Side of the Cruise Industry,” warded. Seafarers’ Bulletin 14, 2000; International Commis- 12 The Maritime provinces likely spend more than sion on Shipping, Inquiry into Ship Safety: Ships, C$100,000 for their presence at the Seatrade Cruise Slaves, and Competition, ICONS, 2000. Shipping Convention. The largest portion of this 3 See Joel Glass, “ICCL Gives Ultimatum to House spending is by the Port of Halifax and the Province of Representatives Subcommittee on Relocation of of Nova Scotia. Foreign-Flag Ships,” Lloyd’s List, May 15, 1993, p. 13 A representative from Stockholm, Sweden, told me 3. For further detail see U.S. Congress, Hearing on at the Seatrade Convention in 2001 that she stopped H.R. 1517, Foreign Flag Ships: Hearings before the having an exhibit, finding it more effective to visit Subcommittee on Labor Standards, Occupational cruise line executives individually (usually in Janu- Health, and Safety of the Committee on Education and ary or early February) and developing a more per- Labor of the House of Representatives, 103rd Congress, sonal relationship. She attends the Seatrade Con- 1st session, Government Printing Office, May vention to see folks she has previously met, making 13,1993, Y 4.ED 8/1:103-09. it a point to attend sessions in which they are pre- 4 See Michael Connor, “Norwegian Line Would Fit senters or observers. Her strategy raises the question Nicely with Carnival,” Reuters, December 2, 1999. for an aspiring port, “what is the best vehicle for 5 This figure was presented by Mark Barnard (Man- ‘selling’ a port to a cruise a line?” ager, On-Board Revenue, Holland America Line) 14 I have been told by tour operators in several cities in his power point presentation in Session #9: “Maxi- (both Canada and Alaska) the details of what they mizing On-Board Revenue and the Benefits of IT,” receive for shore excursions and am able to contrast at the Seatrade Cruise Shipping Convention, Mi- this with the amount charged passengers by the cruise ami, Florida, March 14, 2002. line. There is plenty of anecdotal information, but 6 Put simplistically, e-procurement relies on compu- the identity of my sources needs to be protected. ter software to trigger ordering, warehousing, and 15 These fees are a norm in the cruise industry’s rela- delivery of supplies to ships. It is done in the most tionship with a port. The fees are normally collected cost effective manner, both in terms of purchase price by a concessionaire such as Panoff Publishing, as well as reducing warehouse time and other costs. OnBoard Media, or Miami Cruiseline. On a visit to 7 “Some Say Increase in Cruise Passengers Bad for Key Juneau in January 2003 I was told by a number of West,” Miami Herald, January 5, 2003. merchants that the fees had been lower when the 8 This is described in some detail in Ross A. Klein, cruise industry was just growing, but the percentage Cruise Ship Blues: The Underside of the Cruise Indus- has grown in recent years. Forty percent or more try. Gabriola Island: New Society Publishers, 2002 was not uncommon. The 40 percent figure was also 9 See Kelly Bouchard. “Passenger Ships Cause used by an Alaska state senator in my conversations $500,000 in Pier Damage,” Portland Press Herald, with him about the cruise industry in October 2002. December 13, 2002. business.mainetoday.com/ 16 For a complete list of fines, see news/021213ships.shmtl www.cruisejunkie.com (Large fines, Alaska fines, and 10 See the United States Passenger Vessel Services Act All environmental fines). of 1888. 17 Egypt fined Royal U.S.$23.5 million 11 Digby received a Cdn$100,000 grant from the At- after its ship ran aground and damaged a reef at the lantic Canada Opportunities Agency toward con- mouth of the Gulf of Aqaba in the Red Sea. Mexico

22 Canadian Centre for Policy Alternatives – Nova Scotia fined a ship U.S.$1 million after it damaged the 24, 2002, “Luxury Cruise Lines Sued for Illegal Great Mayan Reef near Cozumel. Lesser fines have Dumping: Lawsuit aims to halt illegal dumping of been levied by Cayman Island for reef damage and ballast water by fun ships in California ports.” http:/ for discharging food and other waste, by Bermuda /www.bluewaternetwork.org/press_releases/ which has fined ships for discharge of oily bilge, and pr2002apr24_ss_ballastwater.pdf by Brazil which recently fined Cunard Line follow- 29 Beverley Ware. “How Badly do Ships Pollute Hali- ing a discharge of nearly 8000 gallons of heavy fuel fax?” Halifax Daily News, December 15, 2002. oil into Guanabara Bay near Rio de Janeiro. Source of figures: Splash, Vol. 1 (2), Fall 2002. 18 Marilyn Adams. “U.S. Keeps Wary Eye on Cruise 30 See Bill McAllister, “A Big Violation on Wastewater: Ships for More Pollution,” USA Today, November Some Ship Readings 100,000 Times the Allowed 8, 2002 http://www.usatoday.com/travel/news/ Amount,” Juneau Empire, August 27, 2000 2002/2002-11-08-cruise-dumping.htm www.juneauempire.com Also see Interim Cruise Ship 19 Linda Nowlan and Ines Kwan, Cruise Control: Regu- Sampling Data Summary, September 6, 2001 lating Cruise Ship Pollution on the Pacific Coast of www.state.ak.us./dec/press/cruise/pdfs/interim- Canada. West Coast Environmental Law, 2001. summ090601.pdf http://www.wcel.org/wcelpub/2001/13536.pdf 31 This was confirmed in correspondence from Joseph 20 See “Citizens Want Cruise Ship to Keep Waste Out Valenti, Senior Vice President of Crystal Cruises, to of Bay,” Washington Post, December 8, 2002, p. A 2. Lynn Young, on behalf of Save Our Shores, dated 21 I was told by an informed source that a cruise ship January 17, 2003. More recently I acquired a draft had an incidental discharge in Vancouver Harbour of “Environmental Guidelines for the Operation of in May 2002. Attempts to gain written evidence have Cruise Ships in Canadian Coastal Areas,” Novem- not been productive, but a journalist had the same ber 1, 2002. These guidelines were drafted by the information as I and from a different confidential Canadian government in consultation with the cruise source. ship industry, but not in consultation with the Ca- 22 Correspondence from Carnival Corporation to the nadian public or coastal communities. California Water Resources Control Board, January 32 For the full story, see Dan Laidman, “Cruise line 16, 2003. says rookie mistake led to ship’s waste dumping,” 23 This figure is an estimate from the International Monterey Herald, March 7, 2003. Maritime Organization. It is referenced and used in: 33 In 2002, Carnival Corporation paid an U.S.$18 mil- Ocean Conservancy, Cruise Control: A Report on How lion fine for discharging oily bilge from ships be- Cruise Ships Affect the Marine Environment, Wash- longing to Carnival Cruise Line, and Norwegian ington, DC: OC, May 2002. Cruise Line paid a fine of U.S.$1.5 million after it 24 Haley & Aldrich, Inc., “Royal Caribbean Cruises admitted to discharging oily bilge and other wastes Ltd. Environmental Compliance Audit Report – M/ from two of its ships. Violations include incidental V Zenith,” June 2002. discharges in Vancouver and Santa Catalina Island, 25 “Citizens Want Cruise Ship to Keep Waste Out of an “accidental” discharge of partially treated sewage Bay,” Washington Post, December 8, 2002, p. A 2. in Juneau Harbour, and a discharge of 8000 gallons 26 Rina Chandarana, “Ships Dumping Bilge Are of heavy fuel oil near Rio de Janeiro. Slaughtering Birds Off Canada,” Reuters News Serv- 34 Private conversation with official at Alaska Depart- ice, September 25, 2002. See also, Kelly Toughill, ment of Environmental Conservation. “Canada a Haven for Sea Polluters, Animal Group 35 People pollution refers to the over-congestion of peo- Says,” Toronto Star, September 25, 2002. ple in a small area to a point beyond what is com- 27 See Kevin Cox, “New Marine Guidelines Aim to fortable or reasonable Curb Aquatic Hitchhikers,” Globe and Mail, De- 36 According to an International Transport Workers’ cember 11, 2002, p. A 12. Federation-administered survey to cruise ship work- 28 The State’s failure to enforce the ballast water law ers home ported in Port Canaveral, Florida, in 2000, has led four organizations (Bluewater Network, En- 16 percent earned less than $500 a month, 38 per- vironmental Law Foundation, Surfrider Foundation, cent earned between $500 and $999 a month, 19 and San Diego Bay Keeper) to file a law suit to stop percent earned between $1000 and $1499 a month, cruise ships from violating California state law. The 17 percent earned between $1500 and $1999 a case is described in a joint press release issued April month, and 12 percent earned more than $2000 a

Cruising – Out of Control 23 month (in U.S. dollars). Room and board are pro- time per month and those in the deck and engine vided by the employer, however some cruise lines departments work 103 hours of overtime per month. charge for uniforms, staff pay for their own laundry These contracts are online at www.itf.co.uk and dry cleaning, and are in some cases charged for 40 Most workers are members of a national union in medical care. their home country and they work under the rules 37 International Transport Workers’ Federation, Big Red of that union. In my travels, I have found Carib- Bombshell, ITF, February 2001, p. 6. bean, Filipino and Indonesian (among others) work- 38 See Kirk Nielsen, “The Perfect Scam: For Workers ers commonly having contracts of 10 to 12 months; Life Is No Carnival, Believe It or Not,” Miami New workers from Italy or Greece have contracts of 6 or Times, February 3-9, 2000, 7 months. www.miaminewtimes.com; Christopher Reynolds 41 Ross Klein. 2001. “High Seas, Low Pay.” Our Times, and Dan Weikel, “For Cruise Workers, Voyages Are December/January: 29-34. No Vacations,” Los Angeles Times, May 30, 2000, p. 42 For further information on the ITF see http:// T5; Kevin Moran, “Lost at Sea: Cruise Workers Must www.itf.org.uk/general/newsindex.htm and on War Endure Long Hours for Others’ Leisure,” Houston on Want see http://www.waronwant.org/?lid=1 . The Chronicle, September 29, 1996, p. 29; and Joshua “Sweatships” campaign can be located at http:// Harris Prager, “For Cruise Workers Life Is No ‘Love www.waronwant.org/?lid=2377. Boat,’” Wall Street Journal, July 3, 1997, p. B1. 43 Linda Nowlan and Ines Kwan, Cruise Control: Regu- 39 The International Transport Workers’ Federation has lating Cruise Ship Pollution on the Pacific Coast of model contracts for seafarers. These include a provi- Canada, West Coast Environmental Law, 2001. sion that hotel employees work 162 hours of over- http://www.wcel.org/wcelpub/2001/13536.pdf

24 Canadian Centre for Policy Alternatives – Nova Scotia